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Photo illustration shows the DeepSeek app on a mobile phone in Beijing (GREG BAKER) \u00b7 GREG BAKER\/AFP\/AFP <\/p>\n Photo illustration shows the DeepSeek app on a mobile phone in Beijing (GREG BAKER) \u00b7 GREG BAKER\/AFP\/AFP <\/p>\n
As DeepSeek releases its first major new artificial intelligence model in over a year — DeepSeek-V4 — here are five things to know about the Chinese startup:<\/p>\n
– ‘Sputnik moment’ –<\/p>\n
Founded by Liang Wenfeng in the eastern Chinese tech hub Hangzhou, DeepSeek started life in 2023 as a side project of Liang’s data-driven hedge fund that had access to a cache of powerful AI processors made by US chip giant Nvidia.<\/p>\n
It shot to global attention in January 2025 with the release of its R1 deep-reasoning large language model, which sparked a US tech share sell-off.<\/p>\n
Industry insiders were stunned by R1’s high performance — at a level similar to ChatGPT and other leading US chatbots —\u00a0and DeepSeek’s claims to have developed it at a fraction of the cost.<\/p>\n
Venture capitalist Marc Andreessen described it as a “Sputnik moment” — referencing the 1957 launch of Earth’s first artificial satellite by the Soviet Union that stunned the Western world.<\/p>\n
–\u00a0Censorship concerns –<\/p>\n
Like other Chinese chatbots, DeepSeek’s AI tools eschew topics usually censored in the world’s second-largest economy, such as the 1989 Tiananmen crackdown.<\/p>\n
That and data privacy concerns have led DeepSeek AI to be banned or restricted on government-issued devices in several countries, including the United States, Australia and South Korea.<\/p>\n
However, its low cost and ease of deployment have\u00a0made it a popular choice in developing countries, analysts say.<\/p>\n
The company holds four percent of global market share for chatbots, according to web traffic analysis company Similarweb. ChatGPT dominates at 68 percent.<\/p>\n
–\u00a0Open source –<\/p>\n
DeepSeek’s systems are open-source — meaning their inner workings are public, allowing programmers to customise parts of the software to suit their needs.<\/p>\n
That is the same for other major Chinese AI players, including tech giant Alibaba, in contrast to the “closed” models sold by OpenAI and other Western rivals.<\/p>\n
The Chinese government has trumpeted its lead in open-source AI technology, which it says can accelerate innovation.<\/p>\n
“Chinese AI models are leading the way in the open-source innovation ecosystem,” National People’s Congress spokesman Lou Qinjian told policymakers this month.<\/p>\n
– Startup boost –<\/p>\n
The success of DeepSeek has galvanised China’s AI scene, despite hurdles posed by rivalry with the United States, and fears of a global market bubble.<\/p>\n
Shares in two leading Chinese AI startups, Zhipu AI and MiniMax, soared on their market debuts in Hong Kong this year, and it has been a similar story for Chinese chipmakers such as MetaX.<\/p>\n
Shi Yaqiong and her team at Beijing-based Jinqiu Capital told AFP there has been a “clear surge” in enthusiasm around Chinese AI — and competition among investors — since the DeepSeek shock.<\/p>\n
– Chip smuggling reports –<\/p>\n
DeepSeek’s rise has not been without controversy.<\/p>\n
Reports, including in technology outlet The Information, say DeepSeek has been skirting a US ban on the export of top-end chips to China to train its new V4 model.<\/p>\n
The Information said in December, citing six people with knowledge of the matter, that DeepSeek developed V4 using thousands of chips dismantled in third countries and smuggled to China.<\/p>\n
DeepSeek did not respond to AFP’s request for comment. Nvidia did not respond to a request for comment but told The Information that they had not seen any evidence of this and that “such smuggling seems farfetched”.<\/p>\n
On Friday, DeepSeek said it had used both Nvidia and Huawei’s domestically-produced Ascend chips for its new model.<\/p>\n
Huawei, at the forefront of Chinese efforts to reduce reliance on US semiconductor technology, said in a statement Friday that the full range of its Ascend\u00a0products support DeepSeek’s V4 series.<\/p>\n
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